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White House Threatens Veto of Spending Bills Exceeding Bush's Target

By David Clarke, CQ Staff

May 11, 2007 -- White House Budget Director Rob Portman warned Congress Friday that he will recommend that President Bush veto fiscal 2008 spending bills if they exceed the administration's request.

Congress is in the process of finalizing a fiscal 2008 budget resolution (S Con Res 21) that is expected to set an overall discretionary spending cap for the 12 appropriations bills that will be more than $20 billion above the president's $932.8 billion adjusted request, a figure that does not include any Iraq war funding.

"I will recommend the president veto any appropriations bill that exceeds his request until Congress demonstrates a sustainable path that keeps discretionary spending within the president's topline of $933 billion and ensures that the Department of Defense has the resources necessary to accomplish its mission," Portman wrote in a letter dated May 11 to the chairmen and ranking minority members of the House and Senate Budget committees.

In the letter Portman also urged Democrats to produce a plan that sets the stage for extending the president's 2001 and 2003 tax cuts (PL 107-16, PL 108-27) before they expire in 2010.

"We oppose the budget resolutions passed by the House and Senate because they would threaten the economic and job growth of the past four years through massive tax increases, increase federal spending by hundreds of billions of dollars, and fail to address the unsustainable growth in entitlement spending," Portman wrote.

The House version of the budget resolution (H Con Res 99) made no allowance for extending Bush's 2001 and 2003 tax cuts beyond 2010, when most currently are set to expire. The Senate version allowed for extension of some, but not all.

Republicans have maintained that both five-year budget plans would lead to tax increases because fully offsetting extensions of the 2001 and 2003 tax cuts, as required under new pay-as-you-go rules, would be difficult.

The Senate budget resolution proposes devoting about $180 billion over five years toward extending popular tax breaks such as the reduced 10 percent bracket, the child credit, and changes to the estate tax. Conference negotiators on the budget are debating how to handle this proposal in the final budget resolution.

House Budget Committee Chairman John M. Spratt Jr., D-S.C., and Senate Budget Chairman Kent Conrad, D-N.D., maintain that failing to offset the cost of tax cuts has led to a dramatic increase in the nation's debt since Bush took office in 2001.

Informal budget negotiations between House and Senate Democrats are expected to continue over the weekend, with a final deal on the fiscal 2008 budget resolution expected early next week.

No decisions were made at Thursday's formal meeting of the full House–Senate conference committee, which was dominated by opening statements and discussions regarding the proposed budget.

Negotiators may adopt a trigger mechanism for the tax-cut extensions, although the Portman letter appeared hostile to that idea. Spratt has suggested making only 80 percent of any projected 2012 surplus available for the tax cuts. But he acknowledged the House's pay-as-you-go rule would have to be "relaxed," since extending the tax cuts would reduce a projected 2012 surplus.

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